Tuesday, 30 October 2012

Indie Authors and the US IRS Department

There are times when being a non- US citizen certainly has its drawbacks. And this especially applies to writers who sell their book through Amazon. For as we all know, they're an American company and anyone who does business with them must go through the IRS - Internal Revenue Service. Unless, of course you're happy not to receive any royalties from the sale of your book, as the IRS will have swallowed it all by charging you a tax from which you are exempt!

So, all us non-US citizens - I'm Australian - are expected to fill out certain forms, provide details of our "foreign citizenship," provide passport documentation and all the other details specified on their W-7 Form.
And that's when the fun begins!
For no matter how detailed and accurate your paperwork, no matter that you've completed all the correct documents, even have it checked by a lawyer to make sure everything's in order, the IRS will find something inaccurate or missing, even if they have all the correct information sitting right in front of them!

That is exactly what's happening to me. And it's been going for over eight months now. It's reached the stage where I'm practically ripping my hair out trying to deal with these people. I'm convinced they don't want non-US citizens to have an ITIN (Individual Taxpayer Identification Number) just so they can gouge more money out of us!
It's another drawback being an indie author - you have to do everything yourself, when it's usually the publisher who would handle all these issues.
So, before I give up completely or get on a plane to Austin, Texas, front up to them and physically show them I'm not a US citizen and therefore don't need to get taxed by them, (especially since my country has a tax treaty with them) I'll ring. Even though it'll be two o'clock in the morning here, the people who work for the IRS will be just starting work.
Hopefully, I'll get someone understanding, someone who'll actually look at my file and see that it's been correctly filled in and all necessary documentation included. And hopefully I won't behave like a distressed female and cry into the phone out of sheer frustration. Although, if I get a man it could be a useful strategy. But I have a feeling most people employed by taxation departments world wide are chosen simply for their inability to empathise and so my emotional outcry would be a waste of time!

Is my situation normal or have other people experienced problems with the IRS? I'd dearly love to know - I'm running out of hair and tissues!


R Chazz Chute said...

Good news. This strategy worked for me: http://catherineryanhoward.com/2012/02/24/non-us-self-publisher-tax-issues-dont-need-to-be-taxing/

I got the EIN over the phone. Contrary to the link, I still had to go through the SS4 but it wasn't a big deal. Now I just have to send out the W8-BEN, but the process was much simplified from dealing with the way other route.

Tima Maria said...

Hi Robert,
Thanks for that info. I've checked Catherine's site & I'm definitely going via the EIN rather than ITIN - less torture!
I'll be ringing them early tomorrow morning.

Diane said...

Goodness Tima, that sounds absolutely dreadful! As you know, I published via LSI, and I have not had any of the problems you listed. I'm not sure why (and I probably do not want to know...)

Tima Maria said...

Hi Diane, Yeah it's a problem, but thanks to some great advice from those who've experienced the joys of dealing with tax departments, I now have my EIN - Employee Identification Number. I simply rang them direct, answered a few questions and had my tax number in fifteen minutes!
Wish I'd know that sooner.
Oh, by the way, there might be a delay in releasing my book on Amazon. I was at the GenreCon this weekend, and repr. from both Harlequin and Penguin asked for my full manuscript. So, I'm going to wait and see what comes of it.